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EXCLUSIVE: London's rich could face Lib Dem 'super mansion tax'

A super “mansion tax” which would clobber London’s wealthy elite could be brought in, a senior Liberal Democrat told the Evening Standard today.

Party president Tim Farron said it would hit the very richest even harder than the controversial levy on homes worth more than £2 million which is already being championed by Lib-Dems.

With Labour leader Ed Miliband also supporting a mansion tax, Mr Farron’s proposal will alarm owners of multi-million pound homes across the capital and South East.

However, it will also delight many Lib-Dem activists preparing for the party’s annual rally in Glasgow which starts this weekend.

Just days ago, property experts Knight Frank warned the levy would have to be imposed on homes worth just over £1.5m to raise the £1.7 billion previously earmarked by the Lib-Dems.

They added that this would nearly double the number of homes affected, from 55,000 to just under 100,000.

But in a wide-ranging interview, Mr Farron floated the idea of different mansion tax rates.

He stressed he would prefer to make the very wealthy pay more rather than lower the threshold for paying it to below £2m.

“Even when you are talking about people who are relatively wealthy, it’s important that taxation should be progressive,” he said.

“I would rather that we looked at people who had properties and wealth at much greater levels than that (£2m) were paying a higher proportion rather than trying to dip down below because I do take the point that in London there are many homes that are worth a significant amount of money which would be seen as not exorbitantly luxurious properties.

“You could have various rates within the mansion tax, a property worth £4m, for example, paying at a higher rate, as well as a higher global sum, than those with smaller properties.”

The Lib-Dem president insisted the levy would be a “very modest tax” for people whose property just “slips” over the £2m mark.

“There is a way of doing this without damaging people who are potentially in a more marginal position,” he added.

The Lib-Dems unveiled their original mansion tax policy in 2009 but were quickly forced to raise the threshold from £1m to £2m amid concerns about the number of homeowners who would be affected, particularly in London.

The current proposal would mean a £1,000-a-year bill for a home worth £2.1m or £10,000 on a £3m property.

In the interview, Mr Farron also warned 2015 would be his party’s toughest election battle for a generation, voiced support for raising the top rate of tax back to 50p, argued against Ukip leader Nigel Farage taking part in election TV debates, opposed a third runway at Heathrow, and urged Nick Clegg to ensure a Lib-Dem woman is soon appointed to the Cabinet.